Psychologists describe people who focus attention on the activities and events happening in the present as having a present hedonistic time perspective. We were interested in identifying the costs and benefits of “living for now.” In this study we measured people’s time perspectives, money management skills, tendency to experience positive emotions, and personality factors. Results indicated that focusing on the present has positive impacts on emotions; however, this hedonistic time orientation may come at a cost to your bank account.

Benefit: People who have present hedonistic time perspectives experience the positive emotions joy, love, amusement, and compassion more frequently. Research has shown that focusing on the past reduces the frequency of positive emotions and compassion for others. To be happier and experience more positive emotions, you can focus on the present more by savoring the experiences you have and enjoying them thoroughly.

Benefit: If you take a present hedonistic time perspective, you tend to value stimulation in your life, and probably agree with statements like “change is good” and “whatever the challenge, bring it on.” The benefit of having these perspectives is intuitive; life is consistently changing and providing new challenges, so being able to adjust to these novelties comes in handy.

Benefit: A present hedonistic time perspective can affect your social life as well. People who focus on the now are more likely to be extraverted, active, and high-spirited. Research has shown that extraverted individuals tend to be happier than introverts.

Cost: “Living for now” can have detrimental effects on your bank account. Those who have a present hedonistic time perspective report weaker desires to save money. Research has suggested that individuals who score higher on savings management tend to feel more financially secure and are more satisfied with their lives. Focusing on the present is a great way to increase positive emotion and social connections, but it should be balanced with a conscious awareness of the finances being used in the moment as well.

Cost: People who live in the now are also less likely to have financial clarity. This means they are less likely to know how much money they have, what they owe, and know how much to plan for future events. Research has suggested that individuals who don’t manage their money well are more likely to make compulsive and impulsive purchases, have less savings, more debt and are less satisfied with their lives.

At BeyondThePurchase.Org we help people understand the relationship between money and happiness. To better understand the benefits of specific consumer choices, we continue to investigate the relationships between consumer preferences, psychological needs, happiness, and values at our website by allowing people to take tests on personality. To learn about what might be influencing how you think about and spend your money, register with Beyond The Purchase, then take a few of our personality quizzes:

Do you tend to make decisions considering the past, future, or more immediate needs? Take the Zimbardo Time Perspective Inventory and learn how time perspectives have been linked to a wide variety of human behaviors.

How materialistic are you? Take the Material Values Scale and learn about your spending habits. We think you may learn a lot about what causes you to part with your hard-earned money.

Can money buy happiness? Take our experiential buying survey and on your feedback page you will learn how to spend your money to be happier.

Which spending decisions will make you happiest? Take our Spending Choices and Happiness survey and on your feedback page you will learn how to spend your money to be happier.

How happy are you these days? Take our Happiness and Life Satisfaction quiz and find out your happiness score.

Are you a compulsive buyer? Take the Compulsive Buying Scale and learn about your spending habits.

In what ways do you hope your purchases will transform your life? The Transformation Expectations Questionnaire will tell you about what you expect from your next big purchase.

With these insights, you can better understand the ways in which your financial decisions affect your happiness. Responses to these surveys will also help researchers further understand the connection between money and happiness. To read more about the connection between money and happiness, go to the Beyond the Purchase blog.

In a recent study we conducted in my lab, we investigated how consumers who are able to practice restraint in purchasing are different than those who are loose in their spending habits. The results show that there are distinct differences between tightwads, those who have trouble spending money, and spendthrifts, those who have trouble not spending money. Using the data we collected on BeyondThePurchase.org, we find there are five advantages to being a tightwad.

Tightwads use their money wisely. There are numerous articles in the consumer research that show buying experiences, like going to concerts and dining out, provides consumers with more happiness than buying material items, like jewelry and clothing. Our data shows that tightwads have a tendency to buy more experiences than material items. Also, spendthrifts tend to buy more material items than experiences and therefore do not enjoy the same benefits as more thrifty consumers.

Tightwads practice healthy spending habits. On top of not using their money to effectively increase their happiness, spendthrifts are prone to compulsive buying—maladaptive repetitive buying associated with lower self-esteem and higher depression. Spendthrifts are also more likely to buy without thinking. Tightwads are also more conscientiousness and seem better adapted to avoid these mental health issues.

Tightwads are not easily influenced. Trusted advice is not as valuable as having the ability to make up one’s own mind. Tightwads are less susceptible to having their minds made up by others. Spendthrifts are more likely to possess a desire to comply with others’ wishes.

Tightwads have eyes on the prize. Tightwads not only value achievement more than spendthrifts, they are also more open to self-development. This combination makes it more likely for tightwads to find success professionally and perhaps at home. A strong correlation between being a tightwad and positive emotions, specifically joy and contentment, suggests that exercising financial restraint may inspire happiness all on its own.

Tightwads are not what you think. Being a tightwad is depicted as a 16th century character who is an old miserly man with tight purse strings–a wretched old man who never had any fun. However, considering what these results tell us, perhaps you being a tightwad leads to being wise, healthy, happy, independent, and highly-motivated.

To better understand the benefits of specific consumer choices, we continue to investigate the relationships between consumer preferences, psychological needs, happiness, and values at our website. At BeyondThePurchase.Org we help people make the connection between their spending habits – how do you spend your money and who do you spend it on – and their happiness. To learn about what might be influencing how you think about and spend your money, Login or Register with Beyond The Purchase, then take a few of our spending habits quizzes:

Which spending decisions will make you happiest? Take our Spending Choices and Happiness survey and on your feedback page you will learn how to spend your money to be happier.

How happy are you these days? Take our Happiness and Life Satisfaction quiz and find out your happiness score.

How materialistic are you? Find out by taking the Materialistic Values Scale.

Are you a compulsive buyer? Take the Compulsive Buying Scale and learn about your spending habits.

In what ways do you hope your purchases will transform your life? The Transformation Expectations Questionnaire will tell you about what you expect from your next big purchase.

With these insights, you can better understand the ways in which your financial decisions affect your happiness.

My research team and I just completed a study to examine the differences in how happy people live their lives compared to people who are unhappy. Because we were interested in several characteristics of happy people, we examined the predictors of happiness from 30 different surveys. These surveys measured people’s spending habits, consumer choices, values, and personality traits. Results indicated that happy people make five little decisions every day that improve their well-being.

What are five importance differences between happy and unhappy people based on our recent consumer behavior studies?

Happy people manage their money well. Something that anyone can do every day is to make a budget and track their financial transactions so they don’t make impulsive purchases. Research suggests that individual will manage their money better when they have a clear goal—your money management goal could be to pay off a credit card, save for a comfortable retirement, or to start saving towards an emergency fund. Our data shows that if you manage your money better today, you will be happier tomorrow.

Happy people spend their money on life experiences instead of material items. Almost ten years of research has investigated the effects of investing money in life experiences, as opposed to material items. There is now robust evidence that when people spend their money on life experiences they are happier than when they spend their money on material items. However, our data shows that people who habitually spend their money on life experiences are happier than people who tend to buy material items.

Happy people think about the past fondly. Perhaps unique among all animals, humans have the capacity to travel backward and forward in time—to use the “specious present” both to relive past life events and to think about the future. Our data shows that happy people appear to live in the past, reliving the ecstasy, but ignoring the agony, of days gone by. When happy people think about their past they focus on their good memories instead of dwelling on the negative parts.

Happy people “catch” the emotions of others. Some people are vulnerable to experiencing others’ emotions–they are sensitive “catch” others’ emotions during joyful (and sorrowful) experiences. Our data shows that when someone smiles warmly at happy people, they smile back and feel warm inside. Therefore, if you pay more attention to the emotions of other people you will be happier.

Happy people live in a great community. A person is happiest when three basic psychological needs are satisfied: autonomy, competence, and relatedness. Literally thousands of studies demonstrate the positive effect of psychological need satisfaction on happiness. Our data shows that these psychological needs can be met by one’s community. Happy people say that they feel belongingness where they live and that they look forward to coming home when they have been away.

BeyondThePurchase.Org helps people make the connection between their spending habits – how do you spend your money and who do you spend it on – and their happiness. To learn about what might be influencing how you think about and spend your money, Login or Register with Beyond The Purchase, then take a few of their spending habits quizzes:

How happy are you these days? Take our Happiness and Life Satisfaction quiz and find out your happiness score.

Some people are gadget heads and some are foodies. Which do you spend your money on? The Experiential Buying Scale provides you with personalized feedback to learn what kind of things you tend to acquire.

How do you feel about where you live and where you would like to live? The Quality of Place scale tells you how satisfied you are with numerous different features of your neighborhood.

You can also learn how well do you manage money by taking our Money Management quiz and if you focus more on the past, present, or future when you take the Zimbardo Time Perspective Inventory.